Photo: AFP
Photo: AFP

India gets WTO nod to establish dispute panel

The US blocked India's first request on 21 November but, under WTO rules, when a complainant makes a second request the panel is automatically established

Geneva: India on Tuesday secured the World Trade Organization’s (WTO’s) permission to establish a dispute settlement panel to rule on controversial unilateral duties imposed by the US on the imports of steel and aluminium under the controversial US Section 232 security provisions.

At a dispute settlement body meeting 4 December, India pressed ahead with its second request for establishing the panel on the grounds that the additional duties of 25% on steel products and 10% on aluminium imposed are “inconsistent with the US’ WTO obligations under the GATT (General Agreement on Tariffs and Trade) 1994 and the Agreement on Safeguards."

The US blocked India’s first request on 21 November but, under WTO rules, when a complainant makes a second request the panel is automatically established. On Tuesday, Switzerland joined India in making a second request against the American duties.

In turn, India and Switzerland join seven members—China, the EU, Canada, Mexico, Norway, Turkey and Russia—who have already secured the nod for establishing the panel against the US.

“This collective resort to dispute settlement reflects the serious concern of the WTO Membership over the United States’ actions," India said, emphasizing that “it also reflects trust and confidence in the WTO as forum for resolving international trade disputes." It called for a “single panel" to rule on the US tariffs, as all the complaints are related to the same matter. India said a single panel will be able to examine these disputes, “particularly given the complainants’ willingness to coordinate and proceed in this matter."

At present, there are nine panels that are established and it remains to be seen whether a single panel will be constituted. Nevertheless, the panel proceedings will begin and the three members for the panel have to be agreed by the both sides. If there is no agreement among the complainants on the one side and the US on the other, then, the WTO director general will be asked to constitute the panel.

The US has warned that the legitimacy of the dispute settlement system and the viability of the trade body would be undermined if the WTO were to initiate panel proceedings against the additional duties. Washington issued several threats against the complainants,who have maintained that the additional duties are“safeguard" measures. The US has all along maintained that the additional duties are not safeguard measures.

The US has maintained that the duties imposed on steel and aluminium are “issues of national security and political matters not susceptible to review or capable of resolution by WTO dispute settlement."

“If the WTO were to undertake to review an invocation of Article XXI [security exceptions], this would undermine the legitimacy of the WTO’s dispute settlement system and even the viability of the WTO as a whole," the US has said. It has warned that “infringing on a sovereign’s right to determine, for itself what is in its own essential security interests would run exactly contrary to the WTO reforms that are necessary in order for this organization to maintain any relevancy."

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